By the Division of Banks

Sales Finance Co. License Requirements For Entities Purchasing Retail Installment Agreements From Sales Finance Companies

Under Mass. Gen. Laws chapter 255D, a sales finance company is defined as any person other than an installment seller engaged, in whole or in part, in the business of purchasing retail installment sales agreements or revolving credit agreements of one or more retail sellers. A seller is defined under the statute as a person who sells or agrees to sell goods or services or both or merchandise certificates, pursuant to a retail installment sale agreement, or revolving credit agreement. Accordingly, an entity which intends to purchase retail installment sales agreements from a sales finance company and not from a seller, as defined by the statute, would not be required to obtain a sales finance company license under Mass. Gen. Laws chapter 255D.